Market research

[Bob Harper]

Hello all, this is my first post here and I wonder if I can ask for some help with market research.

I am aware that there are many accountancy providers to freelancers and contractors, but they all seem to stick to traditional accountancy and tax services.

I'm curious, do you think there is an opportunity for an accountancy firm to offer something extra with input on business development? Things like, sharing ideas that work for others contractors/freelancers, book reviews, video training and easy to read guides. This could be in the area of developing a business strategy, planning, marketing, pricing and professional sales.

Are there contractors looking for more than accounts/tax from an accountant.

Bob

[cojak]

No.

What you may have noticed around here Bob (unfortunate name around here but you'll get used to it...) is that many contractors like their accountants cheap.

As for me, I like my accountants to do what they do well for a reasonable amount of money.

If you can add value I'd listen but I don't think I'd swap accountants for it.

[Bob Harper]

Thanks

I've heard that many contractors are looking for cheap.

Great that you are open minded enough to listen, what do you think are the important non accounts/tax issues facing contractors/freelancers?

Bob

[MarillionFan]

I've heard that many contractors are looking for cheap.

Great that you are open minded enough to listen, what do you think are the important non accounts/tax issues facing contractors/freelancers?

Bob

The difference between services may or may not include bookkeeping and either have the cost of your tax return included or not. That's pretty much it.

[cojak]

Great that you are open minded enough to listen, what do you think are the important non accounts/tax issues facing contractors/freelancers?

Bob

Finding the next contract. And training from an accountant probably won't sort that one out.

[malvolio]

I've heard that many contractors are looking for cheap.

Great that you are open minded enough to listen, what do you think are the important non accounts/tax issues facing contractors/freelancers?

Bob

Talk to the oracle - have a good look through www.pcg.org.uk and see the size of the problems we face.

Also there are two kinds of freelance contractors - those who supply specialist knowledge and/or delivery expertise and those who want to grow into some kind of small bsuiness, such as a specialist bureau service or website design business. You're after the latter group, the former won't be that interested.

[Bob Harper]

Thanks again.

@MarillionFan - thanks.

@Cojak - I accept a traditional accountant will not be able to help you find your next contract. However, what about if an accountant research this topic or even paid a specialist to produce some video training about using LinkedIn to win contracts?

@Malvolio - thanks and interesting to split the market like this.

Any ideas how to identify "entrepreneurial" contractors/freelancers? My first thought is to produce some guide/resource for them covering more than the basic stuff - what do you think?

With contractors who supply specialist knowledge/expertise is there an opportunity to help them create more profit with more sophisticated pricing strategies?

Bob

[philip@wellwoodhoyle]

Bob, I think you'll find that freelancers/contractors are in general terms, a very different beast to your more typical small business entreprenneur.

Without wanting to sound derogatory, a very large proportion of freelancers/contractors are "bums on seats" within the large employers - they are "employees" in reality, but are deemed "self employed" for tax/employment legislation purposes. Likewise their accountancy needs are different.

When I worked in a "normal" accountancy practice, we hated one-man freelancer companies because they were different - they didn't fit into our checklists and work programmes, etc., often because of poor record keeping, trying to claim for things they couldn't etc.

When I started my own practice, I accidentally fell into becomming a contractor specialist, and as such have designed strategies for them which make their and my life easier with simple systems and structures.

I've had hundreds of contractor/freelancer clients, and very few (literally only a handful) have gone onto becoming a "proper business" - most stray between permanent jobs and freelance works. They are employees at heart and only stray into self employment either for tax reasons, or because they have to due to the agency requirements. The work they do isn't much different to that of an employee. Many are so disinterested in "business" that they can't even do their own invoicing or book-keeping or write up their own expenses claims - they are happy to pay for others to do this for them. However much help and encouragement, these are the kind of people that are unlikely to become "true" entreprenneurs.

Your challenge will be finding ways to identify the freelancers/contractors who really have what it takes to be entreprenneurs.

Don't be misguided into thinking that because there are hundreds of thousands of "self employed" freelancers/contractors, you are looking at a pool of hundreds of thousands potential entreprenneurs. You're not. You're looking at pool of workers, just like looking into a car factory, or a hospital, or a warehouse - some will have the ability and inclination to become entreprenneurs, many/most won't.

And I have to say again, that none of what I've said is meant to be detrimental to freelancers/contractors - I'm drawing the distinction between "entreprenneurs" and mere workers. Being "in business" doesn't make someone an entreprenneur.

[malvolio]

Any ideas how to identify "entrepreneurial" contractors/freelancers? My first thought is to produce some guide/resource for them covering more than the basic stuff - what do you think?

If we knew that, life would be much simpler...

Start from the PCG website, Resources, Market Research. But one set of numbers might be illuminating - the average spend by PCG members (who are probably better informed than the average) on accountancy services is £1500, for insurance is £100 and for marketing less than £100.

With contractors who supply specialist knowledge/expertise is there an opportunity to help them create more profit with more sophisticated pricing strategies?

Doubt it. Ours is the only market where you have to set the price before knowing the job to be done. You need to understand the stranglehold the current commoditised agency model has on the market; it is the single biggest inhibitor out there. It's also worth £27bn a year, so is not going to be easily diverted. Then again, on the current gig my pre-tax profit is around 94%, the one before that it was 83% but for the four months in between them I wasn't earning anything.

As I said, you need to do some reading. It's way more complex than you seem to think

[MarillionFan]

post above

WWS.

The vast majority of contractors are disguised employees trying to eek out a higher return than permanent employees. Only a handful go on to do become greater than themselves or implement Plan B's of any note.

As opposed to asking questions which I believe are slightly disingenuous why not outline in detail what you are proposing if of course you are not of the top drawer ilk.